(General discussion) The voting rights of Binance and other exchanges/custodians

CKB Community Fund DAO
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Edited to add Chinese translation

@JackyLHH I wasn’t sure how to label this topic, please feel free to change if needed.

What I would like to bring up for a general discussion (not a proposal) may not be a problem at this current time, but I believe that it is something that needs to be addressed sooner rather than later.

If it isn’t dealt with now, then there is a real possibility that a time will come that it is impossible to fix in a decentralised way using the governance system.

While I’m not sure of the accuracy of this number, I have seen mentioned multiple times that Binance ‘owns’ around 10 Billion CKB, which is around ¼ of the current CKB supply.

While Binance would hold a certain number of CKB as liquidity for buying and selling on their exchanges, they would also be holding a large number in custody for customers who choose to leave their CKB on the exchange.

The possible issue is that in the future, Binance may offer CKB Staking to it’s customers. This means Binance would stake the CKB in the Nervos DAO on the customers behalf and pay a certain amount of the DAO compensation they collect to the customer. This in itself is not a real problem.

The problem would be that Binance (or any other exchange) would have the ability to use these staked CKB to take part in governance voting.

This would obviously be catastrophic to the DAO and destroy the whole point of having a community DAO in the first place.

The reason I believe this needs to be addressed now is for the simple fact that if Binance stakes their CKB holdings in the DAO tomorrow, then they could use their voting power to veto any attempts from that point on to prevent them from taking part in the governance system.

While I doubt Binance has any interest in getting involved in the community DAO at this point in time, things may be different in the future if/when Nervos is fully governed by the DAO and the direction of the whole network is decided on through this type of governance system.

I’m not sure if it’s possible to prevent certain addresses from taking part in the voting or how these addresses could even be linked to certain exchanges, so maybe this can’t be done at a system level.

And even if there was a way to manually blacklist addresses, it would open up the possibility that this ability could be abused, so maybe this method wouldn’t be suitable anyway.

My idea is that there could be an acknowledgement that has to be ticked by everyone before submitting any vote, declaring that they are not an exchange/custodian or taking part in any sort of proxy voting. They must be the true owner of the CKB.

While this would not be enforceable or meaningful in any legal way, it would at the very least be a public moral issue and create bad press for the exchange if they were found to be clearly going against the community’s wishes. This alone would hopefully be enough to prevent this from happening.

I’m not even sure what is possible to implement using the Metaforo system, so maybe even something like this isn’t able to be done at this stage.

But if it does turn out to be a case where nothing can actually be implemented, I still believe we could go forward with some sort of vote. This would just lay down the community’s stance on this matter so that it is fully clear that it either is, or is not something we want to happen.

Anyway, this is just my opinion, if anyone has any other ideas or thoughts on this matter, please put them forward here.

我想提出来供大家讨论的（不是提案），在目前可能不是一个问题，但我认为这是一个需要尽早解决的问题，而不是以后。

如果现在不处理，那么真的有可能有一天会出现无法利用治理系统以分散的方式解决的情况。

虽然我不确定这个数字的准确性，但我看到多次提到Binance "拥有 "大约100亿CKB，这大约是目前CKB供应量的1/4。

虽然Binance会持有一定数量的CKB，作为在其交易所买卖的流动性，但他们也会为选择将其CKB留在交易所的客户持有大量的托管。

可能的问题是，在未来，Binance可能向其客户提供CKB抵押。这意味着Binance将代表客户将CKB押在Nervos DAO中，并将他们收取的DAO补偿的一定数额支付给客户。这本身并不是一个真正的问题。

问题是，Binance（或任何其他交易所）将有能力使用这些入股的CKB来参与治理投票。

这显然对DAO来说是灾难性的，并且首先破坏了拥有社区DAO的全部意义。

我认为现在需要解决这个问题的原因很简单，如果Binance明天将他们持有的CKB抵押给DAO，那么他们可以使用他们的投票权来否决从那时起阻止他们参与治理系统的任何尝试。

虽然我怀疑Binance此时是否有兴趣参与社区DAO，但如果/当Nervos完全由DAO治理，并且整个网络的方向是通过这种治理系统决定的，那么未来情况可能会有所不同。

我不确定是否有可能阻止某些地址参加投票，或者这些地址甚至如何与某些交易所联系起来，所以也许这在系统层面上无法做到。

即使有办法手动将地址列入黑名单，它也会带来这种能力被滥用的可能性，所以也许这种方法不适合。

我的想法是，在提交任何投票之前，每个人都必须勾选一项确认，声明他们不是交易所/托管人或参加任何形式的代理投票。他们必须是CKB的真正所有者。

虽然这在法律上不能强制执行或有意义，但如果发现他们明显违背社区的意愿，这至少会成为一个公共道德问题，并为交易所创造坏的新闻。仅仅这一点就有希望阻止这种情况的发生。

我甚至不确定使用Metaforo系统可以实现什么，所以也许在这个阶段连这样的事情都无法做到。

但是，如果它确实是一个实际上无法实施的案例，我仍然相信我们可以继续进行某种投票。这将奠定社区在这个问题上的立场，使其完全清楚，它要么是，要么不是我们想要发生的事情。

总之，这只是我的观点，如果有人对这个问题有任何其他的想法或意见，请在这里提出来。

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My first time being involved with something like this but is there a way to enforce one wallet one vote? Not weighted on the amount you hold? But maybe that has drawbacks as well.

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One wallet- one vote doesn’t work, because you can make as many wallets/addresses as you want and just vote from each of them.

There are projects working on one person - one vote using biometrics, which could be a possibility.

But I think the amount of CKB held still has to be taken into account to a point because you can’t have someone who holds 200 CKB in a DAO deposit having the same input as someone with 1 million.

But it is a very fine line here to where the whole thing just becomes pointless for small holders if it’s weighted too much towards holding size alone.

That’s why I think there needs to be a substantial weight given to TIME in the DAO vs AMOUNT in the DAO.

That’s really a different subject though to what I am talking about above, but also something we should definitely be talking about.

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This is a great topic to discuss, thank you @Yeti for bringing it up. I would like to share some of my personal views:

  1. It is unreasonable to directly exclude exchanges or crypto whales from voting in the CKB Community Fund DAO, because they are all important participants in the CKB ecosystem.

  2. I agree with your concern that there is a certain possibility that exchanges or crypto whales will do evil, manipulate or even hinder the development of CKB Community Fund DAO, although in the long run, this will also harm their own interests. Therefore, I personally think that some proposals can be put forward to limit the voting power of exchanges and crypto whales.

  3. The core issue is how to optimize voting power. Perhaps we can learn from the concept of Bitcoin “Coin Days Destroyed (CDD)” and use the “Coin Days” of CKB in Nervos DAO rather than the deposits while calculating the voting power. For example:

  • 1,000 CKB locked in Nervos DAO for 100 days, which is 100,000 coin days, so the voting power is 100,000.

  • 10,000 CKB locked in Nervos DAO for 10 days, which is also 100,000 coin days, so the voting power is 100,000.

  • 100,000 CKB locked in Nervos DAO for 1 day, which is also 100,000 coin days, so voting power is 100,000.

Look forward to seeing more reasonable suggestions for optimizing the voting power and the final proposal!

这是一个很值得讨论的话题，感谢您把它提了出来。我想分享下我个人的一些看法：

1、直接将交易所或者巨鲸完全排除在 CKB Community Fund DAO 的投票之外，是不合理的，因为他们都是 CKB 生态的重要参与者。

2、我同意你提出的担忧，这些交易所或者巨鲸有一定的可能性会做恶，操控甚至阻碍 CKB Community Fund DAO 的发展，虽然从长期来看，这也会损害他们自己的利益。所以，我个人也认为可以提一些提案，来限制交易所或者巨鲸的投票权重。

3、核心问题在于如何优化投票权重。或许我们可以借鉴 Bitcoin “币天销毁（Coin Days Destroyed）” 的概念，在计算票数时，用 Nervos DAO 中 CKB 的 “币天” 来替代存款余额，比如：

  • 1,000 CKB 在 Nervos DAO 中存了 100 天，是 100,000 币天，投票权重为 100,000。

  • 10,000 CKB 在 Nervos DAO 中存了 10 天，也是 100,000 币天，投票权重为 100,000。

  • 100,000 CKB 在 Nervos DAO 中存了 1 天，也是 100,000 币天，投票权重为 100,000。

期待大家能提出更多合理的优化投票权重的建议，并形成最终的提案！

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Hi Jacky, thanks for the response and your suggestions!

I love the idea about the Coin Days method, that would be a great way to weight the voting towards long term holders and give everyone the ability to actually increase their voting power.

I think it’s going to be very important that we maintain interest from the whole community, because it’s very easy to get into a position where the smaller holders start to feel like there individual vote is mathematically useless and they don’t even bother anymore.

But just to clarify something from the first point you made.

I definitely don’t want to restrict any legitimate holder of CKB from their rights to vote, no matter the size of their holdings. My issue isn’t with the whales, it’s not even against Binance being a member of the DAO, it is the fact that they would be staking the CKB being held in custody for their customers (the rightful owners) and using that same CKB to vote for their own interests.

Even though, like you said, they most likely wouldn’t do anything to actually harm the network, I’m just not sure that a centralised exchange would have the same vision for the network’s future as the general community.

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I agree with the observations on this issue, but using Binance as an example here is not very typical and tends to take the case in a more extreme direction.

As it stands now, although Binance does own a lot of CKB, their user agreement does not give Binance the right to put their users’ assets into the Nervos DAO, which is also observable onchain, which essentially amounts to misappropriating users’ assets for investment.

Therefore, as a community, we should monitor this. Once we find that the CKB is deposited to Nervos DAO, we can protest, negotiate and even promote more drastic means, such as collective withdrawals to run out. And Binance does not have this motive. After all, this is only a community DAO. The amount of money is too small for them. It is a little too early to discuss this issue.

I’d rather talk about average large holders who have become large holders by buying and supporting CKBs themselves. They should not be discriminated against, and their support for CKB is significant too. If we had discriminatory terms for large holders, I would be concerned about the growth of CKB instead.

Adding a time dimension might be a good direction. Smallholders like us have more time than large investors who need liquidity more. I don’t know exactly how to do this, though. It requires some calculations.

我同意对这个问题的看法，但在这里用Binance作为例子不是很典型，而且倾向于将案件推向一个更极端的方向。

从目前的情况来看，虽然Binance确实拥有大量的CKB，但是他们的用户协议并没有赋予Binance将用户的资产放入Nervos DAO的权利，而这也是可以在链上观察到的，这实质上相当于挪用用户的资产进行投资。

因此，作为一个社区，我们应该对此进行监督。一旦发现CKB被存入Nervos DAO，我们可以抗议、交涉，甚至推动更激烈的手段，比如集体提现跑路。而Binance并没有这个动机。毕竟，这只是一个社区DAO。金额对他们来说太小了。现在讨论这个问题有点太早了。

我更愿意谈论那些通过自己购买和支持CKB而成为大股东的普通大股东。他们不应该受到歧视，他们对CKB的支持也很重要。如果我们对大持有人有歧视性条款，我反而会担心CKB的增长。

增加一个时间维度可能是一个好的方向。像我们这样的小股东比大投资者有更多时间，他们更需要流动性。不过，我不知道具体怎么做。这需要进行一些计算。

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Hi Kumamon, thanks for adding your thoughts on this!

I agree Binance is an extreme example as it’s by far the biggest exchange holder of CKB, but I’m not targeting Binance in particular, my concern is that even an exchange with far less CKB could still have a negative affect on the DAO. Voyager would be another example, because they held a lot of CKB in custody for their customers (which is now also going to Binance) and there will of course be others in the future.

The issue I see is one where they would offer the DAO Staking as a service to their customers, so it would be an opt-in system. The customers would get a certain portion of the DAO compensation but the exchange would be the owner of the DAO deposit, so they would receive the voting rights.

As I said in my original post, I also agree with you here that Binance would have no interest in taking part in the Community DAO at this point in time. But this is only the very beginning of decentralised governance on Nervos.

From what I understand, the long term plan is that after the Foundation has depleted it’s funds, we will vote to activate the DAO treasury where it will receive a portion of the Secondary Issuance and be a fully self funded and decentralised organisation. At this point it may be a lot more attractive for centralised exchanges to want to have a say in the direction of the whole network.

But this is also the exact reason that I believe we need to act now. Because as soon as an exchange deposits CKB into the DAO, it is already too late, the time to act has passed.

It’s pointless having a vote at that point to exclude them, because their vote is just as legitimate as everyone elses and they could just veto any attempt to change the rules if it affects them negatively.

Also, any attempt at that point to change the rules outside of a vote would destroy the decentralisation of the DAO, because once it is shown that these things aren’t really as ‘decentralised’ as they claim to be and major decisions can still be made outside of the governance system, then the whole thing is over.

I just want to clarify once more that my issue is in no way whatsoever with large holders of CKB. I believe everyone should be able to take part in this system, no matter if they own 100 CKB or 5 Billion.

My one and only issue here is with the possibility that exchanges who hold CKB in custody for their customers could use those CKB to vote for their own self interest.

If Binance has their own holding of CKB that is over and above what they hold in custody for their customers, then I welcome them to put those CKB in the DAO and have their rightful say into the future of the network!

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嗨，Kumamon，感谢你对这个问题的补充!

(Kumamon的引文) “我同意对这个问题的观察，但在这里用Binance作为例子不是很典型，而且倾向于把案件推向更极端的方向。”

我同意Binance是一个极端的例子，因为它是迄今为止CKB最大的交易所持有人，但我不是特别针对Binance，我关心的是，即使是CKB少得多的交易所，也可能对DAO产生负面影响。Voyager将是另一个例子，因为他们为客户保管了大量的CKB（现在也要去Binance），当然将来还会有其他的例子。

(Kumamon的引文) “就目前的情况来看，虽然Binance确实拥有大量的CKB，但是他们的用户协议并没有赋予Binance将其用户的资产放入Nervos DAO的权利，而Nervos DAO也是可以在链上观察到的，这实质上相当于挪用用户的资产进行投资。”

我看到的问题是，他们将把DAO定投作为一项服务提供给他们的客户，所以这将是一个选择加入的系统。客户将获得一定的DAO补偿，但交易所将是DAO存款的所有者，所以他们将获得投票权。

(Kumamon的引文) “因此，作为一个社区，我们应该监督这一点。一旦我们发现CKB被存入Nervos DAO，我们可以抗议、谈判，甚至推动更激烈的手段，如集体提款用完。而Binance并没有这个动机。毕竟，这只是一个社区DAO。金额对他们来说太小了。现在讨论这个问题有点太早了”。

正如我在原帖中所说，我在这里也同意你的观点，即Binance在这个时候不会有兴趣参加社区DAO的活动。但这只是Nervos上分散治理的最开始。

据我所知，长期计划是，在基金会耗尽它的资金后，我们将投票激活DAO国库，它将获得二次发行的一部分，并成为一个完全自筹资金和分散的组织。在这一点上，对于中心化的交易所来说，想要对整个网络的发展方向有发言权可能会有很大的吸引力。

但这也是我认为我们现在需要采取行动的确切原因。因为一旦有交易所将CKB存入DAO，就已经太晚了，采取行动的时间已经过去了。

在那个时候进行投票来排除他们是没有意义的，因为他们的投票和其他所有人的投票一样合法，如果对他们产生负面影响，他们可以直接否决任何改变规则的尝试。

另外，在这一点上，任何试图在投票之外改变规则的行为都会破坏DAO的去中心化，因为一旦显示出这些东西并不像他们声称的那样 “去中心化”，重大决定仍然可以在治理系统之外做出，那么整个事情就结束了。

(Kumamon的引文) “我宁愿谈论那些通过购买和支持CKBs本身而成为大持有人的普通大持有人。他们不应该受到歧视，他们对CKB的支持也很重要。如果我们对大户有歧视性的条款，我反而会担心CKB的发展。”

我只想再一次澄清，我的问题绝不是针对CKB的大持有人。我相信每个人都应该能够参与这个系统，无论他们是拥有100个CKB还是50亿。

我唯一的问题是，为客户保管CKB的交易所有可能利用这些CKB来为自己的利益投票。

如果Binance自己持有的CKB超过了他们为客户保管的数量，那么我欢迎他们将这些CKB放入DAO，并对网络的未来拥有合法的发言权。

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Custodian capture is indeed a potential problem of voting-by-holder governance, but we shall not be haunted as long as we’re aware of it and have a common understanding of where are we going.

Nervos governance should be prepared for such situations and not rely on centralized institutions behaving well. For example, voting-by-holder should only be used on limited occasions. More general governance must be more inclusive, allowing various ecosystem participants to voice - NervosDAO hodlers, liquid CKByte users, miners, dapp builders, service providers like exchanges/wallets/explorers, etc. It’s totally achievable at Nervos because it has a PoW layer 1 so we don’t need to worry about censorship by token holders.

To me an ideal governance system should be layered to accommodate subjects with different professionalism, attendance requirement and actionability. Many small specialized groups on top carry out tasks and implementations; a number of more general groups in the middle define the strategy of different areas like research, business development, or foreign policy; and the whole community at the bottom discusses broad topics such as Nervos vision and constitution. The bottom foundational governance could be build on a mixture of hashrate, NervosDAO deposits, non-transferrable NFTs and other resources. And never forget that hardfork is always there as the ultimate governance option. The real challenge is how can we combine all these on-chain and off-chain mechanisms into a seamless coherent system.

CKB Community DAO (CCD) is a good beginning using a limited governance form, I think it’s ok at least at this moment. It’s cool that @Yeti pointed the problem out so early.

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Translated by Google Translate

托管人俘获确实是持有人投票治理的一个潜在问题，但只要我们意识到这一点并且对我们要去哪里有共同的理解，我们就不会被困扰。

Nervos 治理应该为这种情况做好准备，而不是依赖中心化机构的良好表现。 例如，持有人投票只能在有限的场合使用。 更普遍的治理必须更具包容性，允许各种生态系统参与者发声——NervosDAO hodlers、流动性 CKByte 用户、矿工、dapp 构建者、交易所/钱包/探索者等服务提供商等。这在 Nervos 完全可以实现，因为它有 PoW 第 1 层 所以我们不需要担心代币持有者的审查。

在我看来，一个理想的治理体系应该是分层的，以适应具有不同专业性、出席率要求和可操作性的主体。 许多小型专门小组在上面执行任务和实施； 中间的一些更一般的小组定义了不同领域的战略，如研究、业务发展或外交政策； 底层的整个社区讨论广泛的话题，比如 Nervos 的愿景和宪法。 底层基础治理可以建立在哈希率、NervosDAO 存款、不可转让的 NFT 和其他资源的混合体之上。 永远不要忘记，硬分叉作为最终的治理选项始终存在。 真正的挑战是我们如何将所有这些链上和链下机制组合成一个无缝连贯的系统。

CKB Community DAO（CCD）是一个使用有限治理形式的良好开端，我认为至少目前还可以。 @Yeti 这么早就指出了这个问题，这很酷。

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Hi Jan, great post, thanks so much for your input.

The layered approach to governance that you describe sounds amazing.

I am very excited about this first implementation and really looking forward to see how the system evolves in the coming years.

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嗨，杨，很好的帖子，非常感谢你的意见。

你所描述的分层治理方法听起来很不错。

我对这个治理的首次实施感到非常兴奋，并且真的期待着看到这个系统在未来几年的发展。

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Just started reading through this thread. A layered approach sounds the most ideal, but is the long term goal for general governance to be something that is structured like a national government? Having a system of checks and balances built in could help create a fairer and more beneficial system long term. I believe you’re wanting to use a layered approach in general governance so each idea can be vetted and approved within the correct group or at every layer, but some issues and concerns come to mind with this.

If every group/layer’s voting works independently from each other how do we keep the governance inclusive to all users? Shouldn’t we allow for open proposals and discussions? Should we provide a voting slot for community input within each group? For example users that would normally only get a vote on the bottom layer should have a say on foreign policy if they live in that country. Hearing more representative voices will only benefit the policies put in place.

If groups are working independently then voting on actions that take place within their groups are fine, but what happens when voting needs to occur across the entire layer or ecosystem? Who is allowed to make these types of proposals and does every group receive a single vote on that proposal? Weighted voting in that scenario will always favor a centralized power.

If proposals started at the bottom layer and worked their way up what type of veto actions does each layer have to stop them from hurting the chain? How much power do we give to each layer or groups within that layer? Will the top layer be forced to carry out the voted for proposals as 2 out of 3 layers voted for it?

This is an extreme example: The bottom two layers vote and decide that a L1 PoS system is better overall and wishes for the chain to become that. This should never be accepted by the top layer, as it would destroy the L1 security & decentralization. How do we stop an initiative being voted for that would hurt the chain? A hardfork is an optional solution to this example but should be a last resort.

As the chain grows in age the people who will make up the different groups/layers will change. So what type of governance can be used to help make sure that every group/layer is keeping each other in check?

Having the correct people in each group/layer is helpful, but sometimes the people in those layers may push for actions that benefit themselves rather then the chain or community. Even in limited occasions voting-by-holder may not be the best route to take. What stops a collective of people from various groups/layers from teaming up to push through a proposal? If vote-by-holder is used internally within groups then malicious actors can force changes that would hurt the other users within the group or layer but benefits themselves directly. This would increase centralization, first within the groups then eventually by layer.

I think if a layered approach for general governance is to be used then checks and balances within each group, layer, and across the entire governance should be available to disrupt centralization, malicious or harmful actions. If the right set of checks and balances is in place then vote-by-holder in some scenarios can be balanced out by single vote systems used in others

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That is an excellent post and brings up lots of issues that are going to need to be dealt with going forward.

I think the idea of real decentralization is thrown around in crypto like it’s just a given and will be so easy to implement when the time comes. I mean, you just make sure that no central group is making decisions, spending the money and can’t halt or change the blockchain…simple.

In reality, I think it’s going to be extremely difficult and will be a long, hard road to reach that point where we can actually say any blockchain/project is truly decentralized and not just an illusion.

Would love to hear @janx response to the points you bring up.

这是一个很好的帖子，并提出了很多未来需要处理的问题。

我认为真正的去中心化的想法在加密货币中被抛来抛去，好像它只是一个既定的事实，当时间到来时，将很容易实现。我的意思是，你只需确保没有中央集团在做决定，花钱，并且不能停止或改变区块链…简单。

在现实中，我认为这将是非常困难的，将是一条漫长而艰难的道路，以达到我们可以真正说任何区块链/项目是真正的去中心化，而不仅仅是一个幻觉。

很想听听@Janx对你提出的观点的回应。

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@plurBUDDHA thanks for the thoughtful comment.

First, let me make it clear what I wrote down are rough ideas for the purpose of kicking off governance discussions, it’s neither a settled plan nor even a proposal. I believe Nervos’ governance should be an evolving mechanism based on open discussion. We bootstrap it with a first push in the hope that someday it will roll on itself.

Second, I think all governances we see in Web3 today are premature, bearing the problem of, for example, centralization and collusion, as have been pointed out in countless research literature.

Third, it’s important to balance fairness and efficiency. Everyone in a decentralized community should have his/her/its voice, but the community should also be able to move forward. We can tolerate mistakes as long as we keep the ability to correct. We could use trust as long as there’s a fundamental layer 1 that requires no trust. Like Nakamoto consensus, everyone could participate in and there could be forks, but there will always be a determined next block.

A layered approach sounds the most ideal, but is the long term goal for general governance to be something that is structured like a national government?

Yes, we may find resemblances. Both decentralized communities and modern governments are human institutions and we could definitely learn from the result of thousands of years of trials and errors.

Having a system of checks and balances built in could help create a fairer and more beneficial system long term. I believe you’re wanting to use a layered approach in general governance so each idea can be vetted and approved within the correct group or at every layer, but some issues and concerns come to mind with this.

I believe checks and balances are the key because we’re lazy and ignorant (ok at least I am). PoW system already separates the power of miners, developers and users. Layered governance could further separate users with different specialties into smaller groups, which could be granted rights to get things done, with the guarantee provided by a bottom layer that those small professional groups could always be replaced.

If every group/layer’s voting works independently from each other how do we keep the governance inclusive to all users? Shouldn’t we allow for open proposals and discussions? Should we provide a voting slot for community input within each group?

I think discussions should be kept open to all at least. The upper layers are created for efficient execution within the scope set by the lower layers. The lower layers are always there to check. We can assume the groups on the upper layers would behave optimistically. If anything goes wrong on the upper layers there should always be mechanisms to fall back to a level lower to rescue. I think delegation and separation of responsibility are a must. The bad news is delegation requires some degree of trust, the good news is the trust is checked, because the process is transparent and immutable (you know CKB doesn’t throw 3-month data away and everyone affords to keep a copy of it).

For example users that would normally only get a vote on the bottom layer should have a say on foreign policy if they live in that country. Hearing more representative voices will only benefit the policies put in place.

Then there should be a group on an upper layer for people living in a certain country? I don’t think it conflicts with the layered structure.

If groups are working independently then voting on actions that take place within their groups are fine, but what happens when voting needs to occur across the entire layer or ecosystem? Who is allowed to make these types of proposals and does every group receive a single vote on that proposal? Weighted voting in that scenario will always favor a centralized power.

Layers are about consensus scopes. Voting for a proposal should happen on a layer with a scope matching the people affected by the proposal. It’s tricky to find the borders of layers/groups but I believe it’s practically doable.

If proposals started at the bottom layer and worked their way up what type of veto actions does each layer have to stop them from hurting the chain? How much power do we give to each layer or groups within that layer? Will the top layer be forced to carry out the voted for proposals as 2 out of 3 layers voted for it?

Not every proposal need to go through every layers. Most proposals should happen on upper layers because upper layers are the more “actionable”. The responsibility of a lower layer is to set scope, budget and goals for example, and its upper layers figure out a way to achieve that goal with granted budget. The proposals on lower layers grant rights to upper layers. The upper the layer to more actionable it is.

This is an extreme example: The bottom two layers vote and decide that a L1 PoS system is better overall and wishes for the chain to become that. This should never be accepted by the top layer, as it would destroy the L1 security & decentralization. How do we stop an initiative being voted for that would hurt the chain? A hardfork is an optional solution to this example but should be a last resort.

Such extreme proposals should be voted on the bottom layer, whose voting participant is the whole community. To me “L1 must be PoW” should be written into the Nervos constitution because it’s what defines Nervos. Should a constitution change be allowed to propose on the bottom layer? Different people may have different answer.

Having the correct people in each group/layer is helpful, but sometimes the people in those layers may push for actions that benefit themselves rather then the chain or community.

Yes, pushing for actions that benefit themselves is normal and we can only accept this. It’s not evil it’s just human beings. That’s why we need good governance to help us overcome our own shortfalls, to always check, to see where our long-term well-being lies.

What stops a collective of people from various groups/layers from teaming up to push through a proposal? If vote-by-holder is used internally within groups then malicious actors can force changes that would hurt the other users within the group or layer but benefits themselves directly. This would increase centralization, first within the groups then eventually by layer.

Those are good questions I have no answers. But as I said: We can tolerate mistakes as long as we keep the ability to correct. We could use trust as long as there’s a fundamental layer 1 that requires no trust.

Hope the above replies are helpful.

Although there’re many unknowns, I think we have a good beginning. Due to careful genesis allocation and nearly 4yrs PoW mining, Nervos’ is in a much healthier token distribution compared to others, e.g. the 15% team, 14% private sale, 5% partners allocation at genesis has become 10%, 9.3% and 3.3% respectively, with no one single entity controlled more than 1%. (It’s possible some entity bought in more after the mainnet launch but I don’t think the distribution would differ in a substantial way, given the extreme market conditions we’ve seen and the real-world cost pressure to miners.)

新年快乐～

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@janx Thank you for taking the time to reply, to my questions. I always understood that what you stated was a rough idea for the governance system, it just got my mind running which left me with those thoughts.

You answered all of my concerns really thoroughly, I appreciate that a lot. You were able to provide a deeper insight into how you feel each portion of the system should operate.

I guess at this point the only question left is when should we start discussing how the system should work?

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I think anytime is good for discussion. But it takes time to turn them into actions.

There’re at least 2 ways to move forward and test different ideas:

  1. Propose a “meta rule” change to CKB Community Fund DAO as stated here;
  2. Propose a new DAO and solicit donations.

Both are too early IMO - because we haven’t completed a single complete governance process. I think what’s important at this moment is to participate in CKB Community Fund DAO, submit proposals, vote, check the grants process, and review results. Before creating new rules it’s better to accumulate some real world cases and experiences.

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Jan, there seems to be a major issue with the community fund DAO approval. Currently, many of the Nervos community members are not interested in this voting procedures. In this circumstance, let’s say an whale or group of whales collude and make a proposal that will provide them a lot of CKBs, and vote more than 51% of CKBs in favor of voting themselves will create a huge issue. They can self-vote with the CKBs they already possess and take the fund away for their favor. We need to do something before the first case happens.

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I say we need to create a last step in the procedure that is a final analysis/approval by the key members of Nervos foundations to finalize the decision whether the grant will be given or not.

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Agreed, it would definitely be very premature to make changes to the current DAO structure. It’s a good starting point to begin community engagement and get the ball rolling. I’m more curious about maybe establishing discussion about the long term goal of governance and the systems in place that we move towards.

After reading the DeSoc research paper you linked previously, I think the current Nervos infrastructure provides the correct tools to be able to implement a similar design that allows for the various checks and balances they established to be maintained and properly utilized. Opening up discussion about an end goal would provide us with the ability to help navigate from our starting point and develop into a well structured system that can be backed by research. Even as we grow and develop from the current community DAO we can continue to analyze if how we move forward meets the standards of equality, plurality, and bottom up consensus that’s discussed.

While a discussion post may provide details about a system that works within those parameters and how the Nervos tools can be utilized, I don’t think it would hinder any smaller details that will need to be worked out as we grow from our Community DAO starting point. An example would be the question asked at the start of this thread. These types of details should give us plenty of flexibility in adapting our current DAO into a DeSoc like governance system. I do believe providing an end goal as we build our road map should help to engage more community members as well. Confidence that the system we work towards will always be fair between whales and smaller members should lead to better engagement overall.

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